Stores won’t rest till you’ve bought your gifts

Marathon hours, last-minute deals target holiday procrastinators

NEW YORK (MarketWatch) — In the final week leading up to Christmas, retailers from Macy’s Inc. to Toys “R” Us are gearing up for marathon store hours and last-minute sales in hope procrastinating shoppers will show up and open their wallets.

The stakes are high as sales in the first half of the month were slow, though they have picked up in the last week. And shoppers do appear to be holding back: The percentage of shoppers who said they’ve completed holiday shopping stood at 65% as of this past weekend, compared with 70% at this time last year, according to an International Council of Shopping Centers and Goldman Sachs survey released on Tuesday.

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The survey showed about 12% of shoppers have not even started their holiday purchases yet.

This week alone, including Sunday and Monday before Christmas, could represent about 25% to 30% of retailers’ five-week December sales, ICSC chief economist Michael Niemira told MarketWatch.

“Consumers will likely be out in force this weekend,” Niemira said.

Traffic-tracker ShopperTrak has forecast this Saturday, or so-called Super Saturday, to be the second biggest sales and traffic day after Black Friday, or the day after Thanksgiving and traditional start to the holiday season. This Friday and Sunday also will rank among the top five selling days.

Weekly same-store sales in the week ended Dec. 15 rose 3.5%, the fastest pace since a 4% increase during the Thanksgiving and Black Friday week sales, according to the ICSC-Goldman Sachs sales index. Week-over-week sales last week rose 4.3% following two straight declines.

UPS
UPS, +0.95%
expects this Thursday to be its busiest day of the year, as it expects to deliver 28 million packages, or the equivalent of more than 300 packages every second. The daily total is about double its delivery amount on an average day.

Final push

If you expect retailers will hit the panic discount button this week in the lead up to Christmas, you may be out of luck. Several analysts have said retailers, better with their inventory control, have not discounted more than prior years.

Promotional “activity remains competitive but controlled,” said BMO analyst John Morris, adding his “sales rack index” is down about 5% from last year. Sweaters and outerwear are the exceptions as apparel retailers try to clear out excess stock because of warmer-than-average weather, he said.

While retailers’ November sales have missed expectations, hurt in part by superstorm Sandy, sales so far are pointing to a brighter December, with same-store sales expected to rise 4% to 4.5%, compared with a 1.7% increase in November, Niemira said. He said consumers redeeming their layaway purchases as well as increased online orders will both help boost results in the month. November miss raises holiday stakes.

Meanwhile, post-Christmas sales are increasing in importance for retailers as more shoppers buy gift cards and last-minute shoppers resort to them as “an easy out,” Niemira said. Retailers don’t post gift-card sales until the cards are redeemed.

In another twist signaling changing consumer behavior, about two-fifths of shoppers said they are likely to wait until after a major winter holiday like Christmas to buy at least some gifts and give them later than usual, a survey by coupon site RetailMeNot found. It surveyed about 1,100 shoppers through Monday, finding 55% of shoppers said they still have half of their gift purchases to make.

ShopperTrak data showed the day after Christmas is expected to be the season’s seventh largest in terms of sales.

Crucial stretch for retailers

To attract last-minute shoppers and hope they’ll return after the holiday, Target Corp.
TGT, -0.10%
is hosting a “last minute sale,” from Thursday through Monday, including giving gift cards on select purchases. It’s keeping stores open through 9 p.m. on Christmas Eve, an hour or two later than the closings last year.

Macy’s Inc.
M, -0.39%
is expanding its “last-minute shopping marathon” to most of its stores nationwide as the chain keeps open most of its stores for 48 hours straight through Sunday morning and select stores open for 24 hours straight through the close on Christmas Eve.

Terence/Wikipedia

Toys “R” Us will be open 88 straight hours starting at 6 a.m. Friday through 10 p.m. on Christmas Eve.

Toys “R” Us said it’s keeping its doors open for 88 straight hours from 6 a.m. on Friday through 10 p.m. on Monday. The company also will have a two-day sale on Friday and Saturday, giving away gift cards, discounts and buy-one-get-one-50%-off offers.

With increased online purchases, retailers also have polished their game on that front. Toys “R” Us allows online shoppers to buy through 2 p.m. on Christmas Eve if the orders are picked up in stores. Orders placed by 3 p.m. on Friday also will be guaranteed to arrive with express shipping.

Best Buy Co.
BBY, +0.53%
allows shoppers to buy online until 3 p.m. on Monday and pick up in stores. It’s also giving expedited shipping options after the 19th.

Best Buy also plans to have an additional sales insert that starts this Friday and runs through the weekend. The company also may give incremental offers that hit Sunday and Monday, spokeswoman Erin Bix said.

“The season will be more back-end weighted,” said UBS analyst Roxanne Meyer.

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